Posted
by
kdawson
on Wednesday August 12, 2009 @01:43AM
from the permission-to-google-you-sir dept.

coondoggie writes "Two companies that fired workers and rejected job applicants based on background checks, without informing those people of their rights, have settled with the FTC for $77,000 in civil penalties. Most experts we talked to think this case is just the tip of the iceberg. The companies — Quality Terminal Services and Rail Terminal Services — were charged with violating provisions of the Fair Credit Reporting Act, which requires employers to get permission to look at individual credit reports. If you don't get a job because of information in your report, the employer must show you the report and tell you how to get a copy from the consumer reporting company. There is no charge for the report if you request it within 60 days of getting notice that you did not get a job."

IMO, unless you work directly with cash or are in a position where fraud would be easy, employers have no right to that information.

Shit happens in peoples lives leaving them in precarious positions and things dont get paid on time. Having employers deny applicants based on their credit could put people in a downward financial spiral.

Hell, there is something far more sinister than that. Some of those marks on your credit report can be *disputes*. Honest to God disputes. Errors even.

I can't understand how credit reports are even legal. I checked a few years back and the policies of one of the credit agencies was basically this.... you could make a *single* negative mark against a credit report electronically. Positive Marks? Minimum ONE THOUSAND AT A TIME.

The whole system is violation of due process, and The Constitution. It allows corporations to exact punishment against you, threaten you, coerce you, etc. all outside of a courtroom. Arbitration is not even involved. Just an electronic transaction in a database. All of it with a difference in the levels of sophistication, power, influence, etc. between consumers and companies.

The TSA has a policy where they will threaten their workers if they have bad credit. That's farking duress. I know personally of several employees who paid of Sprint cell phone scams (cell phone bills for service that never existed. Google it) for $100-$200 out of FEAR. Not fear of those scam creditors, fear of the TSA canning their asses over a couple hundred bucks. I should post the letters on WikiLeaks. Full of very threatening language and when they list the options, *nowhere* is there an option that you just can't afford to pay the amount owed. They certainly make it sound like if you can't get the collection agency to agree to something, anything, then you are at risk for losing your job.

The threat of being fired, interests rates going up, not being able to afford ever increasing lines of credit needed to just keep your family above water, all contribute to a very real mechanism in which these corporations can control you. Most people will be afraid and take the path of least resistance, hence the control realized.

This is just the next evolutionary step in the system. The corporations and credit agencies will create a system where they can *control* you without ever spending any resources hiring law firms and going to court.

What many people perceive as intense financial pressure due to a poor economy are what the poor feel whether the economy is good or bad. There are several issues with the credit system and the way people respond to it. To some degree people who fail to pay off a debt may simply be in a state of rebellion. That is not unlike many black youth who are involved in crime as a response to a system that they feel is against them.

There is definitely a "citation needed" there. And I don't understand why you trolls manage to turn every discussion into an attack on Christians. If it were a regular Slashdot attack on Christians and I started talking about how a credit check can make it hard to get a job, I think I'd get modded "Offtopic".

It seems you share a common misconception that the Bill of Rights protects you from private companies and individuals. It doesn't.

The Constitution is about defining (and, supposedly, constraining) the powers of government, particularly its power to wreak havoc in people's lives. It's not about whether a prospective employer can perform a credit check.

For the TSA case you mention, you might have a point, because there the employer is the government and is obligated to respect due process. A private employer? Nope. Unless you have an employment contract, they can kick you to the curb for whatever reason they like, or for no reason at all. The exception is that there are laws to prevent discrimination, so they can't fire you (or decline to hire) for being Ukranian or Buddhist or whatever. If for instance you get arrested, even if you never get charged with a crime, and your name appears in the paper, you can be fired. That's not discrimination.

Somewhere most Americans picked up this quaint idea that the law requires employers to treat employees fairly. Perhaps because there are a number of laws that do exactly that: anti-discrimination laws, the Americans with Disabilities act, laws regarding workplace safety and overtime pay... But as of today there is no law against discrimination with respect to criminal record, or credit history, or musical tastes, or political activities, or any of a million other criteria that are utterly irrelevant to the performance of the job but for some reason might matter to an unjust employer.

Except as required by law, rights don't enter into it. If you want more rights, talk to your state legislator about outlawing this stupid and offensive practice of reviewing credit reports.

Security Clearances are getting yanked over poor credit these days, because someone with a poor credit background allegedly would have a motive for selling secrets solely so that they could pay off their debts. There was a huge story a few years back about a janitor who had been at one facility and had a clearance for decades lost his job and clearance because his credit score went down. (I'll have to search around and see if I can find it.) I know some great responsible people (now) who can't get a clearance because of some stupid credit card bill from their wild youth days.

My guess is that the TSA is checking the credit of their employees periodically and threatening to yank their clearances, which would also yank their jobs. Maybe they should be firing the ones who steal stuff from my suitcase instead..... oh wait, they have no way of knowing who that actually was.

Credit is little more than a way to keep people working for low wages in crappy jobs. The entire credit system is little more than legalized slavery. We can see how the rise of the credit industry has coincided with a slow degradation of real income for workers.

Banks and corporations are working hand in hand to make sure as many people are underwater as possible. Why else would your credit score go down when you cancel a credit card, and also go down when you get a new credit card?

Credit is little more than a way to keep people working for low wages in crappy jobs. The entire credit system is little more than legalized slavery. We can see how the rise of the credit industry has coincided with a slow degradation of real income for workers.

The credit industry is not interested in "being evil" just to be evil. They just want to make money. It's not even in their interest to keep people working for low wages. If you are a bank/credit company, would you rather have more rich clients or more poor clients? Credit scores are an attempt by the industry protect themselves from losses by people who can't be trusted with credit. It's the modern equivalent of the medieval shopkeeper refusing to give another loan to the guy who didn't pay off his last one. True, there are some companies that want you in debt, but didn't invent the whole thing - they're just abusing it. Now stop spouting nonsense.

This is not true at all. A lot of "rich" people (since you seem to think there are only rich and poor people, I'll rope-in the entire middle-class under "rich" too) live beyond their means, and that's credit that never gets paid-off. This group also includes people who don't understand how to manage money, and they'll keep credit lines maxed even if they have money to pay them off.

A good example: my mother's 3rd husband worked for the Census bureau for decades, and he died recently. He was making six figures, throwing cash into his retirement accounts, but he apparently didn't know how to manage his money - turns out, he had about $50k in unpaid credit card debt he was just letting rot, just paying interest. He never told my mother about any of it; he was just keeping up appearances, and pretended the debt wasn't there.

Middle-class/rich are a bank's best clients because they have assets. That means that if they die or default, there's a chance the loan will be repaid (as happened in the above case). If poor people default, the bank gets a big slice of absolutely nothing, so there's a lot more risk. This is why banks refuse to lend to poor people, or will require security for the loan/line of credit.

Trust me, more money in the hands of foolish people just means they're qualified for larger loans, and trust them to take advantage of such bountiful free money!

Sorry sir, your medical coverage has expired, because you lost your job, your credit score went below 620 and we cant cover you.

Honestly, It's one of the most nefarious things done in America today and the Government encourages it.

Also your credit report is the most inaccurate "report" on you. most have lots of glaring errors that take a LOT of energy and time on your part to remove.

Me? I'm sitting here with the rare high score of over 720, but if I lose my job that will spiral down. you cant keep a high credit score if you cant pay your bills.

Unemployed without insurance and have a child hurt, spouse hurt, or even yourself = your credit score slamming down to below 600 within 3 months. Nothing like owing $30,000 or more in medical bills to cause that.

It is DESIGNED to punish the poor or those that lose their job. It's being set up to "encourage" you to take all the crap they dish out at work so you dont lose that job and get blackballed.

It is DESIGNED to punish the poor or those that lose their job. It's being set up to "encourage" you to take all the crap they dish out at work so you dont lose that job and get blackballed.

But if you take that away, people will have less incentive to become rich! Because what with higher tax rates and euthanasia and the lack of freedom to own other people, it's just not worth it to be wealthy.

My Experian report (which has a high score) has me working for Boeing since I was 10 years old. They apparently confused it with my father, but even after several letters pointing out the mathematical improbability of their information being accurate, it's still there.

It's quite probable, but no excuse for the mistake. I am named after my father and ended up with an MCI phone bill. Long story short my parents had told them to cancel the service, but the call center CSR who barely understood English didn't understand it and cancel it. They continued to bill for 2 more months of service at the same time that another long distance carrier was providing and billing for service - my parents refused to pay the bill. They had been arguing back and forth with MCI for 2 years

Why did you post this as AC? I'll put my name to it, if you won't - Evilandi is making a theoretical proposal, then insisting only other people should be judged by scientific standards. His actions are cowardly and abusive. ColdWetDog spoke truth to power (Not that evilandi necessarily has any power, but he's parroting what powerful social structures have told us all). So why not put your name behind that assessment. If you won't, I will.

I can't tell if you're trying to be witty, but I'll just assume you're ignorant of the facts. In the United States, more than 60 percent [washingtonpost.com] of all personal bankruptcies are attributable to medical bills. If you weren't aware of that, you might want to watch the news sometime. We have this new president over here, see...

I'm aware that the US provides significantly less state-funded medical care than most European states, but surely there is a minimum baseline system that they run?

Err... no?

I've visited the US many, many times, and I didn't see the streets crowded with leprous scabious tramps.

That's because you haven't looked in the right places. Granted, you'll not find many victims of leprosy, which usually requires extended contact with another infected person plus a few other factors. But if you look at the homeless population, you'll easily find signs of less than ideal medical care.

If you get picked up in an ambulance and taken to the emergency ward, they can't expect you to pay for that, surely?

Oh yes they can. They'll bill the heck out of you. And of course they'll make that bill high enough to pay for all the other people who couldn't pay their bill before you. If you can't pay, they'll do the same to the next person and your credit gets shot to hell. If you're not insured but can pay, you'll probably end up bankrupt. If you're insured, well, have fun fighting with your insurance company over what's covered and what not.

Moral of the story: Don't visit the US without travel health insurance. Ever.

For non-European visiting foreigners, for example Americans visiting Britain, if you go to hospital you will be charged, but if you do not have medical insurance and do not have funds to cover it, it is highly unlikely that persuing the cost would be "in the public interest" and would in most cases simply be written off. I certainly wouldn't advise Americans to turn up in Accident and Emergency with a credit card in your wallet but no health insurance. That'd end up being expensive (by British standards).

As a non-EU citizen visiting the EU, if you require non-emergency treatment, such as a doctor's visit, you can only get it if you have medical insurance. You won't even get an appointment without it.

But presumably you will either be able to afford private medical insurance, or your government will provide subsidised or free medical insurance. If not, you won't be seen for non-emergency stuff, simple as that.

Some Commonwealth countries (former British Empire colonies and islands that have kept the Queen as their head of state, or have other close formal ties with Britain) also qualify for free treatment under the NHS. America is not one of those (you should have thought of that before you wasted all that tea).

If you are a European citizen, all hospital care within Europe is free. You do not need pirvate medical insurance. If you are visiting a foreign country within the EU, then all you need is your passport and an EHIC [ehic.org.uk] card, and your home country's health service will be cross-billed. Been there did that, when my daughter fell down some steps in France in June and needed two stitches.

As an EU citizen, once you're admitted to state-run hospital, there is no charge for anything. (Well, there are payphones, and you can pay extra to rent your own TV, buy candy from vending machines etc. But everything from basic meals and drinks, to medicine, to surgery, is free.)

For an EU citizen visiting a doctor, it varies. Either it's free and you just turn up (eg. UK) or you visit the doctor and then claim the vast majority of the costs back from the government (eg. France).

If the doctor prescribes medicine, then in some countries like the UK have a flat-rate charge (UK: about 7 quid per item per month, or you can get a pre-pay subscription [dh.gov.uk] for a tenner a month if you use more than one item per month on average), whilst other countries (eg. France) have a subsidy system where cheaper items are bought entirely privately (eg. asthma inhalers, antihistamines) but you can claim back costs for more expensive items (eg. antivirals, antibiotics).

The doctor may refer you to hospital to see a specialist. As soon as you touch hospital, it's all free. However if your condition is not urgent, there may be a long wait. Sometimes a VERY LONG WAIT.

The main use for private medical insurance is to jump these queues and to allow you to see an outpatient specialist straight away. Usually this would be at a private hospital, not a state-run hospital. In some European countries, all hospitals are private so everyone uses the same buildings, it's just a question of waiting for an appointment. In the UK, there are usually (but not always) separate NHS versus private hospitals.

Most medium and big towns have a state-run hospital, although it won't necessarily cover all services (eg. my local Winchcombe hospital doesn't have an Accident and Emergency ward; I have to travel to Tewkesbury or Cheltenham). Only really big cities (eg. Birmingham) or very rich towns (eg. Cheltenham) will have private hospitals.

Ambulance, fire and rescue call-outs are free, but if there is other non-medical insurance covering the accident (such as buildings fire insurance covering a fire, or motor insurance covering a car crash), then the i

Don't mod this too informative, please, there's a few inaccuracies in it.

As a non-EU citizen visiting the EU, if you require non-emergency treatment, such as a doctor's visit, you can only get it if you have medical insurance. You won't even get an appointment without it.

Not true. Any doctor in Germany, for example, would be happy to accept you as a private patient if you can prove that you can pay for it (insurance will help, but a wad of cash can do the same job). And you'll be charged by the same pr

Why would a poor person need medical insurance? If they're poor they clearly can't afford private medical insurance. They should just use whatever the state provides by default, such as the NHS in the UK.

Sorry, are you saying that there are no state-funded hospitals in the US?

No, I'm not saying that. I'm just saying that any hospital will try to bill the patient, regardless of who built it and runs it.

Where do people go who can't afford private healthcare?

The emergency room, mostly. Of course, they'll still be billed, and if they can't pay, the hospital tries to recoup these losses by charging all the other patients more. Since that's more difficult if the patient actually has health insurance (due to contracts/agreements with the insurance provider), they'll mostly do that to anyone who's uninsured.

If the answer is "nowhere", how can that system possibly work?

See above.

It sounds like your healthcare system needs fixing,

I don't live in the US, but man, have you been completely out of the loop on US politics? Sorry to ask so bluntly, but...

they are a good indicator of whose got on the wrong side of a credit agency.

Rubbish. Data protection law gives you the right to see all information held about you, other than national security stuff. Data protection law also gives you the right to correct any incorrect data. It also gives you the right to put a personal statement challenging any dubious data which you cannot disprove. All of these corrections must be displayed and acknowledged by anyone making a credit check on you.

How about just paying for something with money you actually own in stead of using credit for everything? It's pretty hard getting screwed like that and it seems to work in the rest of the world...

Greetings and salutations...
Let me address this...I have spent MOST of my life paying cash for my purchases. Know what that has done for me? Made it IMPOSSIBLE to get a credit card of my own, because I don't show up in the credit reporting agency database. It is nearly impossible to get a loan, and, I get a lot of strange looks when I buy large ticket items. Apparently, the picture of reality in MOST folks minds here in America is that anyone who pays cash for something must be a drug dealer, trying to launder some money.
All right...before anyone else points it out, I COULD get a "secured" credit card, by depositing the amount of cash that I wanted "credit" on. However, how does that differ from a Debit Card? In my mind, not at all. So...after 40 or so years of paying cash for everything, I am forced to get someone else to get a credit card FOR me, under THEIR account. Does that make sense?
Pleasant Dreams.
Dave Mundt

Maybe, but how is any of that your business? How you treat your daughter is relevant to how you might treat your employees, but is it any business of those employees? And let me tell you something, child -- and you MUST be young to be this naive -- if you think "tight situations" arise only "here and there" you have had far too easy a life and are probably going to be in for a very rude surprise down the line. And with that smug attitude, I certainly hope so.

The trouble is, while bad credit record can mean lack of any of these skills, it can also mean:
1) Your house cought on fire
2) Health problems prevented you from working
3) Some script kiddie generated your credit card number and charged you his new PS3 and a ton of porn.
4) Any of those things happened some time ago, but your bad credit record has prevented you from working since

If that's what you're trying to manage, then I daresay you should find direct evidence in support of people's ability to manage regular tasks and survive tight situations.

Credit is a false indicator in this regard. I know people who have amazing credit scores, but I wouldn't trust them to manage a paper sack. Similarly, I know a lot of people who have a strangely wreckless approach to their personal lives, but whose professional work is shockingly squeaky-clean. It is perhaps because they are so dilligent about their professional work that their brain takes a vacation at home.

And, of course, credit can / is usually wrecked by things outside of the control of the person. Health issues, job losses, divorce, moving, and identity theft all ruin credit, and can frequently do so without the end user knowing about it. Personally, my credit was ruined for YEARS without my knowing it, simply because my college roommate had failed to pay the last bill on electricity before moving out. The bill was for 16 dollars, which was too small to actually notify me that anything was still owed, but not too small that it wasn't listed as a default in my credit score. Now that I'm of more firm financial footing, my credit is still terrible. Why? Because I belive borrowing is a symptom of a failure to properly financially plan, which has the side effect that my available credit is low and my credit repayment history is thin.

Credit Score is a tool specifically for financial companies to decide if they want to loan you money. You'll notice that paying your bill in full each month is actually counted as a negative against your credit score, as does shopping around for loans (generating lots of inquiries), consolidating debt, closing unused credit cards, and other things which I personally consider highly fiscally responsible. Again, this is because your FICO is not a measurement of your financial accumen, but rather your potential profitability to moneylenders. Let's keep it as a tool for that, shall we?

I'm a mortgage broker and can sympathize with some of these points, here's some advice based upon the previous post...

"You'll notice that paying your bill in full each month is actually counted as a negative against your credit scoreot true"Not true, low "utilization" which is the percentage utilization of available credit is a positive for your score (generally try to have 70% or less of your credit line available on each card and in aggregate)

"as does shopping around for loans (generating lots of inquiries),"shopping for mortgages or installment loans generally count as a single inquiry if they happen in a short period of time (2-3 weeks). Going to 5 different retail store (which is not "shopping around") and opening cards will hurt your score.

consolidating debt (which means opening new lines of credit), closing unused credit cards (bad move, shortens your average length of time that credit has been established)

If you want consolidate or move to a card with a lower interest rate (or 0% promotion), open the new card, transfer the balance, leave the old card open but destroy it or put it in a drawer (take it out of your wallet). Do not close the old account (shortens your avg. length of time that credit was established). When you pay off the new card, then close that one if you wish and break out the old one.

Best advice I have: pay everything on time (paying double the minimum balance every other month will ruin your credit)... never go 30 days late. Try to keep any balances on revolving accounts (store cards) at 30% or less of the credit limit. Lastly, don't keep getting new cards just because you can (or can get an additional 10% off at Target, etc.)

It really depends on what score you are talking about. Every company has several different scores, all in the same "range" of scores. There is the Fair Issac scores, which they claim are "official" but many people don't use them. Insurance companies have their own scoring systems they use to decide what rate to charge you for Car Insurance in some states, and, like Fair Issac, refuse to tell you how the score is calculated, just give very, very broad Generalities... There are dozens of different "Credit

That info MIGHT be pertinent to a job application but TFS indicates people were also fired from an existing job because of their credit rating. Personally I would be fucked-off to the point of quiting if my employer started ordering regular credit checks on me AFTER I already had the job.

I say "might" but really I can't see it being much use other than a crude process for HR to filter out obvious morons, a first class thief/fraudster will have impecable records and refrences.

Just one of many things that in no way affect your job performance but will disqualify you from many jobs.

Actually I would disagree. I dare say that a person's credit history might be an excellent way to look at how a person manages their tasks/duties.
Here is a list of things I can think of that you could deduce from looking at this sort of a list:
1) Can the person manage regular things coming in and out?
2) Can the person plan and control themselves to stay in control of things?
3) Has the person got enough wits to be able to manage tight situations as they arise here and there?
Thoughts?

Most potential employers checking credit scores don't give applicants an opportunity to explain their situations. 60% of bankruptcies are due to medical expenses. Are all those people who have bad credit scores because they or someone close to them was ill unable to:

Manage regular things coming in and out?

Plan and control themselves to stay in control of things?

Have enough wits to be able to manage tight situations as they arise here and there?

I do agree with you, it sucks. But from the other side of the fence, where I currently work, there's another problem. They know nothing about you. They sent you a CV, that they wrote. They came to an interview, and gave the answers they made up. References just tell you where someone worked these days. So how responsible and sensible is this guy? Credit checks are just one way of finding out *something* about a candidate.

Credit checks are just one way of finding out *something* about a candidate.

Do you honestly believe that? All that a credit check shows is that they are in a database maintained by others. That database was intended to see if a person was profitable to lending institutions. Put aside identity theft for an instant. All the things that are considered "irresponsible" are profitable and give you a higher score. Paying off credit cards fully every month for example is a negative on your credit score. You are not

> Having employers deny applicants based on their credit could put people in a downward financial spiral.

Yipee! That means an upwards financial spiral for those of us with good credit!:)

Anyways, as unfair as this seems, would you really want to work for people who are so shallow that they believe that a credit report is an indication of a person's honesty (e.g. you won't steal). Even if you are willing to work for shallow people, are you willing to work for people who step over that rather fat line th

As a former employee of a notable product safety testing company, I understand this complaint completely. However, I believe the potential for honest, hard working people to be unjustly denied a position outweighs the benefits.

Unless someone is in a managerial position or deals with money directly(credit card processors for instance), employers have no right to my credit information. Given how notoriously difficult it is to clean up a credit report, its unfair.

A negative credit report, i.e. you being strapped for cash, means that you may be susceptible to bribes.

And a positive credit report means that you may have been taking lots of bribes in the past.
Actually, as another person posted, your credit score is an indication how profitable you are to a money lending company, nothing else. You can have tons of cash, never borrowed any money, and you will have a very bad credit rating.

That will be a different kind of bad rating from the one employers are looking at.

There will be no history of paying off loans on the credit report. Lenders won't like that, but employers won't care. The equivalent for an employer is where you haven't got any previous experience in that particular role.

The other kind of bad rating is where you have loans which you haven't paid on time. Lenders and employers will both hate that.

In this economy, there are literally dozens of out of work people applying for just about every opening. Assuming you were turned down for a position, how would you ever know that the reason was due to a background check? Maybe you smell bad or your facial hair is unkempt. Maybe your fingers were stained orange from the Cheetos you eat all day long in your mom's basement. It could have been your broken flip-flops or the raggedy jeans you haven't washed since January. It's possible that the interviewer was put off by your labored breathing and the whistling sound from your nose. I'd bet the abundance of nose hairs was also a factor. While perfectly natural, it probably wasn't the best idea to let loose a SBD in the interview. Shampooing with RID or conditioning with Nix might have kept those jumping lice to a minimum. Finally, ranting about the GPL and Open Source might be friendly banter here on Slashdot, the interviewer was probably asking about the festering open sore on your leg.

It reminds me of people who send random requests under the FOIA. Sure, there is a chance that you may hit on something, but without any actual evidence, how could you ever really know whether there is something there?

Yes, the amusing thing is that the HR person or hiring manager probably actually told the applicant the reason for their failure. It is possible, however, that there was an insider who discovered what happened and was a friend of the applicant.

Most likely, though, they told him afterward because they thought that they could do whatever they wanted with this information and not bother to get his permission or provide notification.

"Most likely, though, they told him afterward because they thought that they could do whatever they wanted with this information and not bother to get his permission or provide notification."

I agree, if someone has the arrogance to do this to existing employees then they will also have the arrogance to tell the person exactly why they are being sacked and act as if they are doing the person a favour, throw in a dash of self-righteousness and they will also update the persons contact details for the repor

The whole idea behind credit reports being used for anything other than whether or not you should be extended credit leaves me sickened. I've known too many hard working people who've had tough times for legitimate reasons who have been horribly screwed by this crap. Even the government mandated free credit reports are kind of bizarre, I had to forcibly tell these scum to cancel an account at one of the "bureaus" three times over the phone for an apparently ongoing reporting service that I didn't have a way to op out of and I still didn't get all the charges back.

I'd consider myself a pretty fiscally responsible guy who tries far more than the average person to keep on top of these things. I try to check my report every year or so [ftc.gov].

I still can't see one of the 3 bloody bureaus. To access my information, they want to know financial information details on a bank account that I closed in college. And the hoops to jump through to get in without that are a lot more effort than I have been able to put out for this.

But if you look back through your newspaper headlines about fraud by people with no past record, you'll see a frequent (but not universal) indicator - the person committing fraud had debt problems, and began stealing to try to pay off debts.

Then how do you account for Bernie Madoff who had impeccable credit before his arrest and conviction? So I guess you would like for him to manage your finances?

I am aware that this is a cliché here on Slashdot, but nevertheless this is a situation where it must be pointed out.

There is a correlation between bad credit and job performance. It might not be a particularly strong correlation, but it is used to justify credit checks by employers.

However, what they don't tend to consider is that it is probably more likely that an outside influence was the cause of both factors. For just one example: a major illness (either the employee herself or a family memb

This is a slippery slope you're walking. Assuming that you want to demand that employers have concrete reasons to deny you a job, you must give them access to your medical history as well as the history of your family? Sure, they can't deny you because they can only show a correlation between bad credit and bad job performance, but then should they be able to dig deeper into the reason for your bad credit?

If you are going to prevent them from accessing personal information, where does this stop? Can they re

The truth is not a slippery slope. I simply pointed out that a bad credit report has NOT been shown to cause poor work performance, or vice versa. That does not logically give them reason to "dig in" to anything further. Quite the contrary, it shows that they have already dug farther than they should, and come up with nothing useful.

You seem to be assuming that they have both motive and justification to keep digging until they do come up with some kind of damning evidence against you, and THAT is the "sl

I should also point out that in many (maybe most?) states, your permission is also required before they can contact a present or past employer to inquire about job performance. And there are very good reasons for that: historically, inter-company communications that did not involve the employee tended to be very one-sided and resulted in all kinds of abuse, up to and including damaging retaliation from said past or present employers.

Of course they can ask questions in their interview. And in some states

So what? There is a correlation between being black and being a criminal, and it's illegal to use that data when hiring! As people of color have poorer credit scores, this is just one more way to redline deserving people for no other reason than racism.

This has been going on for a long time. In 2001, Vulcan (Paul Allen's company) withdrew an offer because I had too many parking tickets (~$1000) on my credit report (parking tickets are a fact of life if you work in downtown Seattle). Paying the tickets wasn't enough, and the offer was withdrawn.

The tickets were from the '90s, and the firm that has employed me for the last six years has ~$3B under investment (including some from Allen personally).Credit reports are a stupid way to evaluate a worker, especially a programmer.

A parking space in Seattle can easily run you 100 dollars a month (which is actually cheap by major city standards). Conversely, items will stay on your credit report for 7 years. As such, that $1,000 in parking tickets represents up to 7 years of parking.

Over the course of those 7 years, a legitimate parking space would have cost 8,400 dollars. By getting lots of parking tickets, grandparent poster actually saved 89% of the total costs associated with parking. Even if the parking tickets represented ju

This has been going on for a long time. In 2001, Vulcan (Paul Allen's company) withdrew an offer because I had too many parking tickets (~$1000) on my credit report (parking tickets are a fact of life if you work in downtown Seattle).

Getting them might be. Not paying them to the point it shows up on your credit report is quite another.

Once again, corporations are not people, but they want human rights. Their bottom line is their self interest, and people are their biggest liability unless they are proactive. Screw the employees and the customer; shareholder dividend is the goal, whenever possible, and permissible by law. Its seems peculiar that this company is shrewd enough to perform the illegal research, and yet, somehow incapable of following procedure, or limiting their legal exposure. Hmmm... I wonder if perhaps some of the emp

You see, this is one of the good reasons there is the Swiss bank secrecy system. It is no-ones business how much money you have or owe! (but there needs to be a system that makes sure you pay your taxes). It is really a pity that US citizens are not allowed to use it anymore...

I understand that every country has their public/private sources of information on a person that can be accessed by certain people for certain purposes: countries would not function without it. This whole 'credit report' thing has me a bit slumped though; it's certainly not something that is as prevalent in its use here in the Netherlands. Sure, banks have set up a system that contains all your loans and telephone companies might not give you a phone if you have a bad history of debt and Experian says so,

Yes it is possible (both in the US and Europe) but expect to have problems getting loan's, credit, bank accounts, anything that requires a ongoing contract of service for payment (non prepaid mobile, cable/Sat TV, home rental)

Managed to have a blank/no credit records in both the US and the UK (lived in both) until I was in my early 30's, but it made things very difficult as the funny thing is no credit report (which basically means you have never needed a credit line/loan, never mind defaulted) is considere

Sure, but getting an apartment in a metropolitan area during a rental crunch might be a problem. And/or getting treated properly in an emergency room might also be a problem too (if you talk to anyone who works in an emergency room, they'll tell you about it).

That being said, if you have a plausible explanation for not having a credit history, like you've just turned 18 years old, or you've just immigrated to this country recently. That's enough for many landlords (although personally, I wouldn't recomme

After my divorce, I discovered that the wife inherits any bad credit from the marriage, but does not inherit a good credit rating. I kept my married name since I had also had a small business as well as an online presence in that name. I had a valid driver's license, and took the joint Sears store card with me, since I had a laptop under warranty from Sears, as well as a car which was registered in both our names. We had purchased several cars, a house, and had numerous store and bank credit cards for more

If you use credit, and that means getting a loan in almost any form, having a credit card, etc, you will have a credit report. What happens is the companies who loan you money or extend you a line of credit report your payment history to the three credit reporting agencies. The information reported is pretty basic, more or less all they say is if you pay on time or not. These companies then keep a file of your info.

So if you never use credit, you won't have a credit history. However, that doesn't really hel

The problem with credit rating is not that it exists, or that it lacks sufficient predictive value for creditworthiness. It's that over the last few decades, credit rating has increasingly become a proxy for overall responsibility and our legal system has upheld its widespread misuse. Credit score is now a prerequisite for nearly everything that has to do with money. Your insurance premiums are a function of your credit score. Your ability to secure a job is dependent on your credit score. Whether a landlord will rent to you depends on your credit score. Just about anyone these days asks you for permission to peek at your score--even your mobile phone provider.

Credit rating was never meant to be used in this way. And yet, everyone does it because it works, and nobody is willing to stand up to it. The future of credit rating is that it will begin to use increasingly sophisticated methods to quantify how much risk you present to a lender, and on the flip side of the coin, it will be used to determine whether you can do ANYTHING. What jobs you are allowed to hold, which people you will be allowed to socialize with, what goods and services you are allowed to buy, which schools you will be allowed to attend, how many children you will be allowed to have, and where and when you will be able to travel.

Creditworthiness is the new class system. What else did anybody expect in a capitalist, consumer-driven society? This is merely the logical conclusion of a set of conditions on a system. Your entire worth as an individual will be quantified and reduced to a single number, and you will be completely under the control of powerful financial entities that sees society as a source of passive income.

The dirty little secret is that credit rating is a system imposed by the rich elite onto the working class. The rich do not have credit, because they have no need for it. Everything they could want, they simply buy. And they buy it with money that the working class earns as a result of real work, but gets funneled to them through--guess what--credit.

The problem is not simply that the working class must borrow from the rich. It is not that in a capitalist society, the working class, by definition, requires others to lend them money to make purchases on goods and services that they cannot buy outright. The problem is that there is no counteracting force--that is to say, the rich have all the power to rewrite the rules of the game as they see fit, and thus there is no real accountability for their misdeeds.

I find it curious that you believe that my statement was anti-capitalist. To the contrary, if you apply my statement to the current economic crisis which was in no small part due to the willful underwriting of bad risks, you will clearly see that the problem is that the financial institutions have become so large and influential that the government bailed them out to prevent a complete collapse of the economy. Had the system been truly capitalist, these lenders would have had to write down their losses, rather than being rewarded by taxpayers for making bets they knew were unwise.

Capitalism when times are good and socialism when times are bad is neither capitalism nor socialism. It's simply robbery.

The credit rating problem is only one facet of the larger issue, which is that our economic system is based upon a belief that it is possible to create a sufficiently accurate quantitative model of risk such that one can "almost always" trust it. When viewed in this larger context, it becomes obvious that the trend towards more data collection, more intrusion into consumer behaviors, is the logical consequence of this flawed belief. It is this idea that the more you know about something, the more predictive you can be--but the fundamental truth remains that there is no way to eliminate risk entirely.

The working class are simultaneously victims and perpetrators of this system based upon flawed assumptions, as are the rich. But I am more inclined to blame the rich because they are the ones who have historically been in control, both financially and politically.

The lending of money, in of itself, is not a bad thing. But when mixed with an easily cowed, manipulated, and self-entitled public that is told from infancy that "you can do anything if you just try hard enough" and "you are special and deserve everything," it becomes a problem. But in whose interest is it to make a credit-based, consumer economy the foundation of the American financial system in the first place? Who do you blame--the ones who are too stupid to behave responsibly, or the ones who encourage them to be stupid in the first place, because it makes them easy to control and profit off them?

Actually, it is a myth that consumer credit did not exist until recent times. The credit card was *invented* as a direct replacement for individual stores all maintaining their own credit books and having to bill monthly. In Victorian England, it was quite normal to walk into a strange shop and have the bill sent to you while you walked out with the goods.

I'm very good with money. Not a total tight-arse, but I manage my money (even over the GFC I've increased wealth by 70%). If somebody is employed, and as part of that employment, they have to balance a budget or place orders with vendors that are the best value based on what is needed, the best employee is somebody who is good with money. Somebody with proven history of bad personal financial decisions is not going to know any better with somebody elses money.

I'm a victim of Identity theft. Some thieves got my name, address, date of birth and SSN, filled out an online form and got a credit card in my name. (Despite the mother's maiden name being wrong. Thank you very much Capital One!) The only reason I found out about it was that the thieves tripped up. They paid to have the card rush-mailed to them and *then* they changed the address from my address to theirs (or at least a drop box of theirs). The card was mailed out before the address change went through and landed in my hands.

I never did catch the thieves (slow working police who weren't prepared for an ID theft case and an uncooperative Capital One), but I learned how to prevent ID Theft: Freeze your credit. Then the thieves can't open any new lines of credit in your name. The only downside is that you can't open up any new lines yourself without first "thawing" the credit file temporarily. (Did that when I bought my new car.)

As a side benefit, people can't look at your credit file either. So jobs can't run background checks without your prior approval and banks can't pre-approve you for credit card after credit card that you don't want or need.

If someone "borrows" your new car while you sleep and returns it all scratched and dented, it would be wrong to say "Well, you were sleeping so you didn't lose use of the car and when you woke up you were able to drive it so it wasn't really stolen." The car was stolen and now you'll need to take time (and spend money) fixing the damage done.

When your identity is stolen, the thieves steal your good credit rating and your time to fix the mess. I was lucky that the thieves tripped up before any real damage

How does one prove that one was denied a job because of a credit report? This question is not rhetorical.

A friend of mine, who has fallen on hard times, suffering the double whammy of unemployment coupled with massive debt, has been unable to find a job for almost three years. He often gets close -- getting past the phone screen, first and second interview, tour of the facilities, and then, at the point where one would expect either an offer or "we have decided to look elsewhere", he gets -- nothing. The prospective employer simply stops responding, as if he dropped off the face of the earth. We are pretty sure something is going on, and it's almost certainly the results of a credit check, (we know his credit is ghastly) but as the company will no longer communicate, he does not know how to proceed.

I'm a little conflicted. I'm fairly libertarian in my views, and believe a company has a right to hire whom they please, but in this case it leaves someone who has had a few setbacks absolutely nowhere to go. Except, perhaps, a life of government subsistence, or I dunno, a life of crime. He wants to work and pay back his debt, but (if this is true) his debt is what is preventing him from finding work -- a classic catch-22. Where does one go from here?

While this is an old story it's also still a problem.
About 6 months ago I read a similar story about business's using the credit reports as a guide to see if a prospective employee would steal or not. The idea being that the better your scores the less likely you are to embezzle, or steal from your employer.
I didn't think about it at the time and forgot about it.
Then my neighbor was turned down for a job based on her credit.

She lost her job a while back (over a year ago), and instead of getting a new job right away, took the severance package and enjoyed some time off from working. By the time she was ready to work again, jobs in her field were hard to come by. After being off for so long and no longer having the severance package to help pay bills, she started falling behind with her bills. Her mortgage company, seeing all the Fed money, refused to refinance the home since she doesn't have a job and started the foreclosure process. She finally found a possible job, and was told that pending a "background check" the job was hers.

By getting this job everything would be golden for her. She could pay her bills and then refinance the house. The problem was that she didn't get the job. The reason was due to the foreclosure on her house. That showed up on her credit report.
So here's the rub. Can't stop foreclosure without a job, can't get a job due to the foreclosure.

Granted, it's her own fault for not getting another job so soon after being unemployed, but I've seen dozens of folks do the same thing. You get a large payout and take a vacation.

I wonder how many other people are caught up in the same sort of issue?
You want to work, but can't due to the credit report, but if you had the job, you could resolve the bad credit report.

You're completely ignoring the fact that the U.S. government is handling confidential, sensitive, classified data. Yes, it makes sense to do an amazingly thorough background check when you're deciding whether this man should have access to nuclear missile schematics. However, it is complete bullshit when deciding whether this man should manage your email server.The reason credit reports are done for access to sensitive information is because someone is actually likely to bribe you for those nuclear missil

However, it is complete bullshit when deciding whether this man should manage your email server.

I think a better comparison would have been "deciding whether this man should clean the toilets in the bathroom". Managing an email server would actually give you access to quite a bit of important information.

Most of what companies do makes sense to no one but them. A company is not a single entity, even, but a whole group of idiots with different priorities and different ideas of how to do things, who probably don't talk with each other all that often, and even less often actually agree.

A previous employer shipped their entire business, hundreds of thousands of dollars worth of electronics equipment, all over the world in reusable plastic boxes with the companies name on them, sealed with velcro. Every time, at least a half a dozen people who were not their employees handled the boxes and had access to everything in them. They still did credit checks on potential employees.

In the IT industry especially, companies are fine with treating local employees like criminals, but then are more than willing to outsource essential work to god-knows-who in skeezy third-world countries.

Not trusting random people on the street is one thing. But not trusting employees is the sign of a ridiculous, horrible company.

Who is most likely to steal from you: The worker who owes 20k dollars in credit card debt and is barely keeping his head above water, or the worker who has a million dollar home and a penchant for finding profit everywhere?

I've found that a lot of people who are in poor financial condition are so because they're weirdly principled about it. They don't feel like they could go for higher salaries, because that would be wrong. They don't feel right about charging for the things that they do. They have specific hangups about money in weird ways, one of which frequently is "money is bad, and getting money is bad. I should just put my nose to the grindstone and everything will be OK."

Whereas a lot of the people I know who do have a lot of money, do so because they're unscrupulous bastards. They know how to cut corners, squeeze full advantage out of situations, and pull the wallet right out of your pants while smiling and making you feel like one of the family. I like the ones that I know, but I also know better than to sign anything around them.

I think it's fair to say that in this case, a Credit Score is not a good indicator of which type of employee will take advantage of "edge opportunities" in your organization. And in that light, it merely discriminates against the kind of suckers, err, "hardworking employees" that you probably do want in your company.

There are credit reports, but it may be they are more strictly regulated. For example in Finland, non-payment of a bill can only appear on the report if the issue goes all the way through the court system. A collection agency can't add it by themselves, for example.